June 25, AtoZForex – The aftershock of the Brexit referendum results is grand and affects the markets globally. Notwithstanding, the investors and firms all around the world are anxious and have dozens of questions. In order to aid these investors and firms, AtoZForex has conducted the Brexit aftermath analysis. Compiling the most frequently asked questions when it comes to the UK leaving Eurozone.
How can Brexit influence the trade with EU?
There is no doubt in the fact, that trade between EU and UK will be affected. If we dive deeper in the issue, the details of the UK trade would be dependent on the future agreements. Let’s analyze three options that Britain would have:
I. WTO: UK can choose to continue trading relations with Eurozone under the rules of World Trade Organization (WTO). This way, the complexity of creating new free-trade agreement would be avoided. The minus of this option appears in eliminating any beneficial relationships the UK has with Eurozone or any other trading bloc, as reported by Bloomberg.
II. New Agreement: The UK can choose the option of negotiating a fully new trade agreement with the Eurozone.
III. Norwegian model: If the UK would remain in the European Economic Arena, it would still be able to access the European Union and take part in the free flow of workers.
Will UK citizens still be able to work and live in the EU?
Now Once again, this matter is also depending on the UK future relationship with the Eurozone.
When is UK officially going to leave the Eurozone?
As it is stated in the Article 50 of the Lisbon Treaty, the procedure for withdrawing from the Eurozone could take two years. During this period of time UK is free to negotiate a new relationship and agreements with the Eurozone.
How is the economy affected by Brexit?
As for the economic consequences of Brexit, most of the financial and economic analytics believe that Brexit would worsen the British economy, at least in the short term.
Until when will David Cameron stays as UK’s PM?
David Cameron already announced to resign as the UK Prime Minister in the morning after the Brexit results. After months of advocating for a Bremain, Mr. Cameron failed to send his message across the Britons. Due to this failure, David Cameron commented that it is time for a new UK PM that represents the public’s opinion.
He will remain in place until autumn this year, to “steady the ship” after the EU referendum results. Analysts in the market expect that the former Mayor of London, Boris Johnson will become the next UK Prime Minister.
Will the general election take place?
UK law states that general elections must be held every five years. There can be two exceptions:
1. A majority of Members of Parliament pass a no-confidence vote in the government
2. Two-thirds of the House of Commons support a motion for an early election.
Currently, it is still unclear whether any of these options will emerge in the aftermath of the Brexit EU Referendum as it is reported by WSJ.
Is the EU referendum legally binding?
No, the EU referendum result is not binding. Considering that the UK government will need to first officially notify Brussels that it will be invoking the Article 50 Lisbon Treaty, in order to start the process of the UK leaving the EU. At the moment, the EU leaders are urging the British government to officially notify Brussels as soon as possible. Considering that no official notification has been made yet. The financial and economic world is currently waiting for the article 50 will be officially invoked, until then the uncertainty in the market remains at large.
Stay tuned to AtoZForex for all the latest updates for the Brexit aftermath analysis.